Working together towards a sustainable financial centre
On 11 December, the Federal Council presented its proposals for promoting a sustainable financial centre. These practical measures give concrete form to parts of the report published in June 2020 on “Sustainability in the Swiss financial centre”. The relevant industry associations were invited to comment, as part of a pre-consultation process.
To meet the disclosure obligations envisaged, it is essential that these are aligned with the environmental impact of companies and are in step with international developments. They must also be based on forward-looking principles. We also welcome the fact that the measures should apply to the entire economy, as this is the only way their full effect can be realised. As far as the financial sector is concerned, it is vital to uphold the principles of proportionality and commensurability. Regarding the financial risks caused by climate change, for example, FINMA’s planned focus is already on the bigger banks, as the risks are expected to be greater here. With smaller banks, the challenges can already be rapidly mastered with instruments that are already available.
To avoid greenwashing, the federal government wants to see regulatory assessments of requirements that take into consideration the exportability of Swiss financial products. The financial sector must continue to ensure the high standard of quality and transparency of its products if it is to meet investors’ demands for sustainability effectively. As far as the exportability of Swiss sustainable financial products is concerned, the sector must play its part in checking these are in line with international developments.
The financial industry is currently in the process of implementing the principles of the Financial Services Act (FinSA). This also extends to the duty of care towards clients, including the relevant environmental and climate change risks. In addition, the financial sector is also pushing ahead with its own initiatives: in June 2020, the SBA published a “Position Paper on Sustainable Finance” and the “Guideline for the integration of ESG considerations into the advisory process for private clients” (including environmental and climate goals). The Guideline contains explicit information on the relevant methods and strategies. This clearly demonstrates that the sector takes the federal government’s recommendations seriously and is already putting them into practice.
The SBA’s declared goal is to position Switzerland as a leading international hub in the field of sustainable finance. The SBA therefore welcomes both further intensification of Switzerland’s participation at international level and the possibility of the country hosting a future UN climate conference. Switzerland is a pioneer in sustainable finance and can contribute to international initiatives in this area by acting as a role model and promoting innovation.